Metadata Title: Tech Companies are Flocking Into Crypto Following Tesla
Metadata: The past month has been pretty interesting from a cryptocurrency perspective. So far, the market has continued to rally, following in a tradition that began in Jan. While there are swings here and there, market sentiment remains strong and could lead to an even stronger rally so far.
Author: Rita M.
Title: Tech Companies are Flocking Into Crypto Following Tesla
The past month has been pretty interesting from a cryptocurrency perspective. So far, the market has continued to rally, following in a tradition that began in January and which looks like it will continue over time. While there are swings here and there, market sentiment remains strong and could lead to an even stronger rally so far.
As expected, a lot of the current strong performance came from growing institutional adoption. In particular, Tesla Motors - which announced a $1.5 billion Bitcoin purchase - has fueled a significant portion of the rally as the firm now looks to become a part of the crypto revolution once and for all.
Fishing Musk’s Affinity for Crypto
Tesla’s market entry wasn’t exactly a surprise. Elon Musk, the company’s chief executive, has been hinting that he will move into the Bitcoin space for a while now. Musk has made several overtures to the crypto space over the past two months, starting when Bitcoin broke its all-time high of $20,000. Musk has shown a greater understanding of what cryptocurrencies are, and he seems to like it a lot through several means.
So, Tesla eventually entered the market. While many expected it, however, no one was quite ready for the volume of Bitcoin the company was going to purchase. By buying $1.5 billion in BTC, Tesla became the market’s largest single-day institutional entrant ever. Data from Bitcoin Treasuries also shows that it is one of the largest institutional investors in the market.
That’s got to feel good for the company and its CEO.
The Money Floods In
Tesla’s entry immediately had a significant impact on the market. The event sent Bitcoin surging, with the asset firmly breaking the $40,000 barrier that it had struggled with for weeks. To put things in context, Bitcoin entered January on a tear and immediately settled at a new record level of $42,000. However, the market thawed, and the asset’s value slipped below the $40,000 mark. At some point, it even went below $30,000.
When Tesla entered the market, Bitcoin’s value was around $38,500. The news immediately sent the asset on another surge, breaking the $42,000 point and immediately crossing $45,000. Over the next week, Bitcoin will break $50,000 and race even higher.
As expected, all of these have meant significant gains for investors. Bitcoin has proven once again to be the most profitable asset in the world, and it is soaking up investors by the day.
Beyond the price gains and profits that Bitcoin investors have accumulated over the past two weeks, it would appear that Tesla’s entry into the Bitcoin space has led a flurry of companies to also commit to it.
Bitcoin Payments Come to Apple Pay
A day following Tesla’s market entry, reports confirmed that users of Apple Inc’s Apple Pay service will now be able to sue the payment processors to buy Bitcoin. The service will be available through BitPay - a crypto wallet provider and payment solution. American BitPay users can now add their cards to the Apple Pay and Apple Wallet services to make Bitcoin purchases.
The collaboration will also allow users to spend their Bitcoin online, in apps, and in physical stores.
Along with Bitcoin, the BitPay Wallet app also superset Bitcoin Cash and Ether and dollar-pegged stablecoins like Binance USD, Gemini Dolar, USDC, and Paxos.
Mastercard to Support Crypto Payments
Soon after Tesla’s purchase, Mastercard, one of the world’s largest payment processors and credit card manufacturers, announced that it would allow its users to spend Bitcoin.
According to the company announcement, Mastercard explained that it would support cryptocurrencies this year. The firm’s nearly one billion customers will be able to spend digital assets at over 30 million merchant stores worldwide. As the firm explained, this initiative will build loyalty from existing customers while also opening the door to more people looking to transition from traditional fiat assets to crypto.
“It’s about choice. Mastercard isn’t here to recommend you start using cryptocurrencies. But we are here to enable customers, merchants, and businesses to move digital value,” the announcement explained.
Mastercard has yet to announce the assets it will support, but it listed out criteria for them. These criteria include strict know-your-customer (KYC) compliance, payment stability, adherence to regulations, and robust customer protection infrastructures.
Most likely, the firm will look to provide support for stablecoins and a few other traditional cryptocurrencies. Definitely, Bitcoin will be a shoo-in fit.
Mastercard is the third major payment processor to support crypto - following Square and PayPal, which have both seen significant gains in their crypto-facing businesses.
Amazon Building a Digital Currency
Amazon has also signaled a move towards a digital asset. This month, the Washington-based company updated two job openings on its employment page, calling for engineers, managers, and software developers to join its Digital and Emerging Payments (DEP) division.
According to the job postings, Amazon is looking to build a digital currency for its Mexican customers. The payment solution will allow Mexican customers to make more seamless payments on Amazon - both for products and several of its services. Most likely, success with this will lead to Amazon expanding its digital currency’s use from there.
The future definitely looks bright for this new alliance. The tech and crypto spaces indeed have a lot that they could offer each other, and this is as good a time as any for more companies in the former industry to move into the latter.
For now, it’s anyone’s guess who will move next. However, it shouldn’t take so long.